By BenefitsPro

Some PPACA defenders have pointed to the relatively modest effects of the RomneyCare employer and individual mandates as evidence that it would only be a bump in the national economy.

But the economist, Casey Mulligan, concludes in a working paper circulated by the National Bureau of Economic Research that RomneyCare imposed the equivalent of an increase of just $20 per month, or 0.4 percent of median earnings potential, on the typical Massachusetts labor income tax rate.

The RomneyCare increase amounts to a big implicit tax on a small fraction of the Massachusetts population plus a small employer penalty, Mulligan writes.

PPACA could lead to the equivalent of a 4.9 percent increase in the typical labor income tax rate at the national level, Mulligan estimates.

But it would have a much larger effect because the employer penalty would be $2,000 per affected employee. In Massachusetts, the penalty is just $295.

But for a complete estimate of the effects of PPACA, economists need to know how it will influence overall behavior, Mulligan says.